21th Bled eConference eCollaboration Essay Example for Free

21th Bled eConference eCollaboration Essay1 IntroductionThis is not a search paper. Rather, it is a doctrine report in which I describe the use of the so called beer distri plainlyion biz (or beer naughty) a logistics and come measurement up concatenation simulation stake in article of belief business-to-business eCommerce. The aim of the paper is twofold First, I deficiency to demonstrate how the beer spicy toilet be apply to leave behind students with a to a greater extent than profound understanding of the reasons w herefore eCommerce technologies atomic number 18 utilize in contemporary hand over orbits to exchange entropy and to facilitate collaboration. Second, I want to sh be both my charter gots and my materials for employ the beer high in eCommerce courses with the IS community, i.e. those scholars that teach (business-to-business) eCommerce or al small(a) image anxiety courses. The beergame is a use of goods and modifyments- gather simu lation game in which students enact a four stage grant arrange. The occupation of this translate fibril is to produce and bring through units of beer the situationory produces and the other three stages deliver the beer units until it reaches the guest at the downstream end of the range of a function of mountains. In doing so, the aim of the toyers is rather saucer-eyed each of the four groups has to fulfil the in(prenominal) distinguishs of beer byplacing assures with the following upstream party. Since conference and collaboration is not allowed betwixt lend grasp stages, the fiddleers invaria588bly relieve unmatchableself the so called bullwhip give awaylet. With bullwhip we refer to the outcome that the beat of periodical orders amplifies upstream in the provide kitchen stove towards the performance end, thereof causing a range of operational tasks. The bullwhip magnetic core is a vigorous-known phenomenon and a declamatory symptom of coordinati on problems in supply bonds. In using the beergame to create the bullwhip effect students experience front hand, not provided the problems of lack of info sharing and collaboration in supply twines, but in like manner the principal(prenominal) causes for the mental home of the bullwhip effect. Henceforth, in introducing eCommerce measures in the later academic terms of the course, students toilet furbish up to these topics through their own experiences. The paper ties in with a recent handling on the ISWorld eMail list on how to make relevant IS teaching for students with circumstantial or no pragmatical experience. In teaching schooling systems (IS) and specifically B2B eCommerce we much experience problems of making relevant those topics for students. The challenge is to get them to appreciate the relevance of IS and to a fault to provide them, not only with a superficial knowledge of the topics, but with a more(prenominal)(prenominal) profound understanding of the reasons why eCommerce technologies are use in practice. Against this mainstaydrop I want to show how the beergame whoremaster help demonstrating the role and need of eCommerce technologies in a topic area in which the students not only lack practical knowledge (i.e. with indirect requests to supply chains), but exemplaryly to a fault do not need their own lay of reference to be able to relate to the topics we teach. To this end, I allow introduce the beergame, demonstrate its use in a classroom unsex upting, posture typical results created by playing the game and show how I embed the game in a typical B2B eCommerce syllabus. I begin with introducing the game and the bullwhip effect (in theatrical role 2). In section 3, I past describe the application of the beergame in a classroom setting I give an overview of a beergame posing and present typical results. Section 4 demonstrates how typical supply chain problems (and the causes of the bullwhip effect) preempt be deduced from the beergame experience in order to motivate the g roughlywork of eCommerce measures for improving supply chaincoordination. The section is concluded by a synopsis of typical eCommerce topics that keister follow the beergame in a typical B2B syllabus (section 4.3).2 The BeergameIn the following I will branch give a brief introduction to the bullwhip effect before I introduce the beergame itself, i.e. its business relationship, geomorphologic frame-up and the rules of the game.2.1 Bullwhip effect as symptom of typical supply chain problems The bullwhip effect is a well-known symptom of typical coordination problems in ( traditionalistic) supply chains. It refers to the effect that the amount of periodical orders amplifies as wholeness moves upstream in the supply chain towards the labor end (Lee, Padmanabhan belt 1997a). Even in the face of s dis opticen node beg belittled variations in consume at the retail end tend to dramatically amplify upstream the suppl y chain with the effect that order amounts are very erratic, and apprise be very high in whizz week and almost zero in the following week. This phenomenon was discovered and first depict by Forrester (1961) who did research into the relationship between ordering and straining keeping patterns using simulation presents (Warburton 2004). The term itself was first coined a round almost 1990 when ProcterGamble perceived erratic and amplified order patters in its supply chain for 589baby diapers. The effect is also known by the names whiplash or whipsaw effect (Lee, Padmanabhan Whang 1997a), which refers metaphorically to the visual image of order patterns woful upstream the supply chain (see figure 3). As a consequence of the bullwhip effect a range of inefficiencies occur passim the supply chain, e.g. high ( sanctuary) short letter levels, poor customer service levels, poor capacity utilisation, aggravated problems with drive portent, and ultimately high be and low levels of inter-firm trust (Chopra Meindl 2001 Lee, Padmanabhan Whang 1997a). While the effect is not new and a lot of research has been conducted and supply chain projects have been initiated since its discovery, it is still a measurely and pressing problem in contemporary supply chains. Various research studies have quantified the effect and estimate that profitability in most supply chains faculty improve by up to 30% by eliminating the bullwhip effect (Metters 1997McCullen Towill 2002).2.2 Beergame setup and rulesHaving introduced the bullwhip effect and its implications for the supply chain and its players I will now introduce the beergame, its setup and rules. I begin by providing a brief history of the game before I present the general building and the rules of the game. 2.2.1 History of the beergame The beergame (or beer distribution game) was skipperly invented in the 1960s by Jay Forrester at MIT as a result of his work on system dynamics (see Forrester 1957). While the o riginal goal of the simulation game was to research the effect of systems structures on the behaviour of pile (structure creates behaviour), the game can also be used to demonstrate the arrive ats of randomness sharing, supply chain farement, and eCollaboration in the supply chain (Li Simchi-Levi 2002). A range of dissimilar forms of the beergame have emerged over the years. The original beergame was realised as a board game (Sterman 1989). Meanwhile a shelve version (Ossimitz, Kreisler Zoltan 2002) and also computerised simulations (Hieber Hartel 2003) have been developed. In this paper I predominantly draw on a slacken version, which I adapted from the so called Klagenfurt design (cp. Ossimitz, Kreisler Zoltan 2002) the structural setup of the table version is shown in figures 1 and 2. I will briefly discourse advantages and disadvantages of the different game versions in chapter 3.1 where I discuss the administration of the beergame in a classroom setting. 2.2.2 Gene ral structure of the game The beergame simulates a supply chain that consists of four stages (retailer, wholesaler, allocator and pulverisation), each of which is played by one or better two or three players (Goodwin Franklin senior 1994). Hence, a supply chain is typically played by 8 to 12 people, while more than one supply chain can be administered in one class at the alike conviction. The task of each supply chain is to produce and deliver units of beer the itemory produces and the other three stages deliver the beer units until it reaches the orthogonal customer at the downstream end of the supply chain. In doing so, the aim of the players is rather simple each sub group has to fulfil the incoming orders of beer. The retailer receives an externally predetermined customer bespeak and slurs orders with the wholesaler the wholesaler sends orders to the distributor, who orders fromthe factory the factory at colossal last 590produces the beer. Hence, orders menstruum in the upstream direction, while deliveries flow in the downstream direction of the supply chain. An important structural aspect of the game is endure (i.e. time lag) in order to account for logistics and action time. Each delivery (and production order) requires two rounds until they are finally delivered to the next stage. In the structural setup of the game this is represented by two transportation system delay fields located in between the supply chain stages as well as at the production end (figure 1). Order flow tickDelayDelayDelaymanufacturing plant FactoryDistributor DistributorWholesaler Wholesaler retail merchant RetailerProduct flow get word 1 yield chain setup in the beergame table versionStudentOutgoing order lie with with sheetIncoming orderWholesalerDelayDistributor DistributorOutgoing deliveryDelayFactoryIncoming deliveryStudentStudentFigure 2 Detailed table layout 2.2.3 Rules of the game The game is played in rounds, which simulates weeks. In each round the follow ing footfalls have to be carried out by the players 1) receive incoming orders, 2) receive incoming deliveries, 3) update play sheets (outstanding deliveries and scrutinize), 4) send out deliveries, and finally 5) decide on the amount to be ordered. In doing so, deciding on each rounds order amount is effectively the only decision that players are able to make throughout the game everything else follows a set of fixed rules. The first rule is that every order has to be fulfilled, both directly (should the players armourying be giant comme il faut) or later in subsequent rounds. In the latter(prenominal) case, players have to keep track of their backlog (backorder) (Coakley et al. 1998). Secondly, inventory and backlog incur cost each item in stock costs EUR 0.50 per week, while each item on backlog costs EUR 1.00. Consequently, the autochthonic aim of each subgroup is to keep their costs low. Hence, the optimal strategy for the players is to run their business with as litt le stock as possible without being forced to move into backorder. Thirdly, players are notallowed to communicate. The only breeding they are allowed to exchange is the order amount there is no transparency as to what stock levels or actual customer demand is only the retailer knows the external demand (Rafaeli et al. 2003). Moreover, the game is based on the simplification of unlimited capacity (in stock keep591ing, production and transportation) and unlimited access to raw materials at the production end (Hieber Hartel 2003). 2.2.4 The external demand In playing the game the external demand is predetermined and commonly does not vary greatly. In the beginning, the supply chain is pre-initialised with inventory levels (e.g. 15 units), orders (e.g. 5 units) and beer units in the shipping delay fields (e.g. 5 units). In order to induce the bullwhip effect to the supply chain the external demand remains stable for a a couple of(prenominal) rounds (e.g. 5 units for 5 rounds) before it suddenly shows one steep increase (jumps to 9 units) before it remains stable again at this high level for the remainder of the game (usually 40 to 50 rounds in total). However, the one increase in external demand is enough to induce variance into the supply chain, which will inevitably star topology to the creation of the bullwhip effect and to a destabilisation of ordering patterns throughout the supply chain.3 Using the beergame in classHaving described the idea, the structural setup, and the rules of the beergame, I will now discuss the administration of the game in a classroom setting. This is followed by the presentation of typical results generated by beergame applications in eCommerces courses. These results are very useful for deriving the causes of the bullwhip effect in discussions with students in a so-called question session (see section 4). For a session outline of a B2B course that uses the beergame please refer to appendix 2 the experiences shared in the foll owing sections are more or less based on this session outline.3.1 Administering the beergame3.1.1 Choosing a beergame version As mentioned above, different versions of the beergame survive for use in classroom settings. The traditional version isa board game in which tokens are somaticly moved on the board to represent orders and stock. The upside of the board version is that people relate well to moving actual objects. However, there are two downsides firstly, the board game is besides slow, embarrassing and complex to administer blink of an eyely and more importantly, because physical objects are used to represent inventory on the board, people enjoy an unwanted transparency of inventory levels of other supply chain stages and can thus strategically act upon their knowledge of incoming stock. The table version of the beergame was originally developed by a team at the University of Klagenfurt (Ossimitz, Kreisler Zoltan 2002). It shows several improvements to the original desi gn such(prenominal) as a leaner and more pragmatic approach to moving orders and stock in the supply chain. Essentially this is done by using paper slips on which numbers are written by the players. However, it still shows some administrative crash such as a bookkeeping person that tops stock of all things happening within the supply chain using a computer. While this functions as a built-in safety net in case something goes wrong, it is still a hurdle to the application in a classroom setting and it also slows down the game, which results in long sessions and the students being bored throughout the game. Henceforth, I have adapted the table version and essentially eliminated the bookkeeper in order to achieve a more straightforward progression of the game. The 592 guess however is that students make mistakes in calculating order amounts or stock levels using the paper play sheet. While it helps to start slowly and to doublecheck the play sheet calculations during the first few ro unds, in a few of my first beergame applications some people indeed miscalculated stock levels, which led to problems with interpreting the info later on. For this reason, right away I use MS Excel and a laptop computer on each table for people to fill in their play sheets this effectively eliminates the risk and breaks a quick progression of the game (see appendix 1 for a play sheet congressman). 3.1.2 Schedule of a beergame session The first footstep in administering the beergame is the preparations of the tables. As is illustrated in figure 2, four fields have to be marked on each table, which is done by fixing to the table 4 sheets of paper using sticky tape. The identical is done with the delay fields. Furthermore, cardboard boxes (or plasticcups) and envelopes have to be filled with small paper slips to pre-initialise the supply chain with orders and deliveries. Then, every table has to be prepared with a stack of order and delivery slips that will be used by the player s during the game. Finally, paper slips with the external demand progression (see above) have to be prepared that are pass to the retailer groups during the game. Also, for administering more than one supply chain, (student) assistants are unavoidable to help with moving boxes and envelopes during the game. The second step is briefing the students in doing so I provide a short introduction to the idea of the game, its history, structure, and rules (see above). When playing in more than one supply chain I stress the fact that groups of each stage are competing with one another (e.g. retailer vs. retailer), in order to get the students to take playing seriously. The third step is to start playing some initial trial rounds with the pre-initialised supply chain and to make sure that everyone gets used to filling in play sheets and order/delivery slips. Then, in the one-fourth step, the speed of playing the game is increased and the game is played for a number of 40 to 50 rounds. The g ame is then stopped abruptly so that the students do not have time to controvert strategically to the coming end of the game. The fifth and final part of the session is a short discussion directly after the game, where I ask students how they felt throughout the game and what they think the average customer demand was. The next session after the beergame session is the debriefing session, for which the selective information that the groups produced throughout the game has to be consolidated, plotted and analysed. Typical beergame results and their creation are presented in the next section the debriefing session is described in section 4.3.2 Typical progression and results of a beergame sessionEvery beergame session follows roughly the equivalent scheme, so that the progression of the game shows a recurring pattern. I usually start playing the game at a slow pace for people to get used to moving objects, taking stock and filling in the play sheets. What typically happens during these first few rounds is that people try to get disembarrass of some of the inventory (e.g. 15 units) in order to manage their costs therefore they often only place small orders in the beginning (for an example see weeks 1-7 in figure 3).Consequently, when the customer demand jumps to the high level in round 6 the supply chain has adjusted to a low demand scenario. After the steep increase m either retailer groups tend to wait one or two rounds in order to see if the increase is permanent (as in figure 3). When they then place the first large order they invariably initiate a bullwhip effect that perpetuates through593out the chain. Typically, the order amount increases with every stage in the supply chain (as in figure 3). What happens then is that the groups move profoundly into backorder (see figure 4), because due to the delivery delays it takes quite some time for the beer to move through the supply chain to the retail end. Getting increasingly desperate players often try t o send signals and place more large orders in the end they typically lose track of what they have ordered and order way too much. The consequence is that the supply chain is flooded with beer and the inventories overflow (see weeks 2035 in figure 4). The effect is that people cease ordering entirely e.g. a lot of very small orders are placed. This is especially true for the high stages of the supply chain (see table 1). In the end, while the retailer groups often manage to stabilise their business, the higher stages have no idea of the actual customer demand and are left frustrated. Bullwhip work70 60 50CustomerOrders 40 30 20 10 0 1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35 37 39 WeekRetailer Wholesaler Distributor FactoryFigure 3 Plot of order distribution, visualising the bullwhip effect Figure 3 shows the order distribution over 40 weeks and a typical bullwhip effect. Figure 4 shows the inventory fluctuation, with oppose inventory representing back order. Table 1 finall y shows the decrease in customer demand information upstream visualised by the average order amount by the four stages of the supply chain in this example. More importantly, theincrease in order fluctuation upstream the supply chain is illustrated by the largest amount having been ordered in each stage and the number of small orders that were placed. This translates into an increase in inventory fluctuation as well. either this information is being used in the following debriefing session to discuss the bullwhip effect, its implications and the reasons for its existence.594Out of stock = Serious lack of service level200 150 light speedInventory50 0 1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35 37 39 -50 -100 -150 WeekRetailerWholesalerDistributorFactoryFigure 4 Example of inventory fluctuation (negative inventory = backorder) Key figures Retailer Wholesaler Distributor Factory order amount (units of beer)8.338.688.759.95Largest order amount25405060 noneof small orders (0-2 unit s)4111418Inventory fluctuation range8481170 one hundred sixty-fiveTable 1 Example of key figures derived from the beergame4 L gather ining from the beergame resultsHaving presented the way in which the beergame is administered and a typical progression of the game and its results, I will now first show how a debriefing session can be used to illustrate supply chain coordination problems and to derive typical causes for the creation of the bullwhip effect. ground on these causes one can then quite easily motivate eCommerce measures and ICT-based supply chain renew initiatives that aim at cut the bullwhip effect and improving supply chain coordination.4.1 The debriefing sessionThe debriefing session follows the beergame session (see appendix 2). I usually begin the session with a brief discussion of students experiences throughout the game. Typically, the following questions are being discussed Did you feel yourself controlled by forces in the system from time to time? Or did you f eel in control? Did you find yourself blaming the groups next to you for your problems? Did you feel despair at any time? This discussion typically shows that people indeed were blaming their neighbouring supply chain partners for not doing their jobs right (either not ordering in a 595sensible way or not being able to deliver) desperation and frustration are common feelings during the last rounds of the game. A first learning from this discussion is that it is the structure of the game (i.e. the supply chain) that causes the behaviour. This is precisely what its inventor (Forrester) intended to achieve and what is referred to as the effects of systems dynamics. A second set of questions can then be discussed in order to reflect upon the beergame itself and its degree of simulating real world conditions What, if anything, is impossible about this game? Why are there order delays? Why are there production delays? Shipping delays? Why have both distributor and wholesalers why not sh ip beer directly from the factory to the retailer? Must the brewer be concerned with the solicitude of the raw materials providers? Using these questions and by stressing the fact that real-life supply chains are much more complex (a huge variety of products and supply chain partners exist, as well as complex criss-crossing networks of relationships) the students can quickly be convinced that real-life conditions favour the yield of the bullwhip to a much greaterextent and that the beergame is indeed a good vehicle to simulate the creation of the effect. Having established this necessary bit of legitimisation, the session can then proceed with presenting the beergame results and with identifying the underlying causes. Hence, the next step essentially is to present, for all supply chain groups, the selective information (table 1) and figures (3 and 4) presented above. In doing so, I typically have a very interactive and lively discussion. I ask what people thought while playing the game and what led them to, for example, place a huge order at a particular acid in the game. In discussing the extreme examples, the class usually shares a laugh, which, as a nice by-product, leads to a more casual atmosphere and contributes to setting an open tone for the remainder of the course. I also honour the benignant supply chain teams at this point in time. This is also the time where I introduce the concept of cumulated supply chain cost, e.g. by pointing out that the product at the customer end has to earn all (cumulated) costs of all supply chain parties this insight serves as a first step in establishing the idea of global thinking and chainwide optimization, which essentially requires eCollaboration technologies. At this point in the session one can then either go straight to identifying the causes and effects of the bullwhip effect (see below), or take a little (useful) detour in discussing a teaching case to corroborate the results and to give the results of the beergame some more credibility. In doing so, I use the case of Italian pasta manufacturer Barilla, one of the first documented cases in which a company launched a project to identify the causes of the bullwhip effect and to introduce some countermeasures (see Simchi-Levi, Kaminsky Simchi-Levi 2003, p. 91).4.2 Identifying the causes of the bullwhip effectThe bullwhip effect, as simulated in the beergame, is mainly caused by three underlying problems 1) a lack of information, 2) the structure of the supply chain and 3) a lack of collaboration and global optimisation. These three causes can be identify in an interactive session with the students by discussing the beergame experiences and then be corroborated with insights from practice and the literature. 5964.2.1 Lack of information In the beergame no information except for theorder amount is perpetuated up the supply chain. Henceforth, most information about customer demand is quickly lost upstream in the supply chain. Moreover, no other information is being shared. With these characteristics the beergame simulates supply chains with low levels of trust, where only little information is being shared between the parties. Without actual customer demand info, all anticipate has to rely solely on the incoming orders at each supply chain stage. In reality, in such a situation traditional forecasting methods and stock keeping strategies contribute to creating the bullwhip effect (Lee, Padmanabhan Whang 1997a Simchi-Levi, Kaminsky SimchiLevi 2003). Unexpected increases in orders from downstream partners translate into rase higher order increases upstream, because when players regard the increase to be permanent and want to avoid running out of stock, they need to update their safety stock levels hence they place an even larger order. Later, when it turns out that an increase was only temporary, safety stock levels are lowered and players might order nothing for a while, hence contributing to the bullwhip effect . 4.2.2 proviso chain structure The supply chain structure, with its design as separate stages and the long lead times, contributes to the bullwhip effect. The longer the lead time, i.e. the longer it takes for an order to lead upstream and the subsequent delivery to travel downstream, the more aggravated the bullwhip effect is likely to be. With traditional ordering, the point in time where an order is typically placed (the order point) is usually calculated by multiplying the forecasted demand with the lead time plus the safety stock amount, so that an order is placed so far in advance as to ensure service level during the time until the delivery is expected to arrive (Simchi-Levi, Kaminsky Simchi-Levi 2003). Hence, the longer the lead time is, the more pronounced an order will be as an reaction to an increase in forecasted demand (especially in conjunction with updating the safety stock levels, see above), which again contributes to the bullwhip effect. 4.2.3 Local optimisatio n Local optimisation, in terms of local forecasting and individual cost optimisation, and a lack of cooperation are at the heart of the bullwhip problem. A good example for local optimisation is the batch order phenomenon. In practice, ordering entails fix cost, e.g. ordering in full truck loads is cheaper then ordering smaller amounts. Furthermore, many suppliers ply volume discounts when ordering largeramounts. Hence, there is a certain incentive for individual players to hold back orders and only place aggregate orders. This behaviour however aggravates the problem of demand forecasting, because very little information about actual demand is transported in such batch orders. And batch ordering, of course, contributes directly to the bullwhip effect by unnecessarily inflating the orders. This might lead to lower local cost in the short term, but translates into higher overall cost at the chain level.4.3 eCommerce measures to tackle the bullwhip effectHaving identified and discuss ed the three problem areas with regard to both the beergame and their real-world counterparts, I then present three areas of improvement that directly correspond to the three problem areas 1) information sharing in terms of electronic data interchange, 2) ICT-enabled supply chain re597design, and 3) supply chain collaboration for global optimisation (see figure 5). In terms of teaching, these three bundles of eCommerce measures and initiatives can then be briefly introduced in one session (see appendix 3) or in more (technical and systemal) detail in three separate sessions (see appendix 2). In the following sections I give a brief overview of what can be part of those sessions.1 reading loss upstream the supply chainWithout direct colloquy, forecasting is based on aggregated, inaccurate information. This causes large stock, high cost, poor service levels. Improvement Efficient communication and information sharing2Supply chain structureLong lead times lead to increasing variabili ty upstream making planning nearly impossible large safety stock is required, variability increased. Slow downstream product flow causes poor service levels. Improvement Supplychain redesign processes, tasks roles3Local optimizationIndependent planning and local optimization lead to inefficiencies, such as local forecasting, batch ordering, inflated orders, etc.ImprovementCooperation to achieve global optimizationFigure 5 Summary of bullwhip causes and areas of improvement 4.3.1 Efficient communication One of the most basic learnings from the beergame is to improve information sharing along the supply chain (e.g. of point-of-sale customer demand data) information sharing is the first step towards more advanced supply chain coordination (Muckstadt et al. 2001). Henceforth, the first step in teaching eCommerce measures is to present the principles and technologies of electronic data interchange. In doing so, I first of all discuss with the students the principles of digitally mediate d alternate of goods by Johnston (1999), essentially a collection of principles for effective inter-organisational electronic data interchange, such as the once-only data entry principle or the synchronicity principle. Based on these fundamental principles I discuss the ways in which traditional document-based ordering can be ameliorateed using electronic data interchange. While these topics might seem to be outdated from a modern information systems perspective, it lays the foundation for a step-by-step increase of complexity that aims at providing the students with a more substantial knowledge of the problems and ideas behind ICT-enabled supply chain reform than can be achieved by a simple presentation of the latest communication technologies. The next step in this endeavour is to introduce technologies that are needed to enable effective inter-firm data interchange and electronic ordering, such as product numbering schemes and automatic product identification technologies. In m ost supply chains physical products have to be handled hence ways are needed to attach information to theseobjects. Consequently, I introduce the following technologies Standardised product numbering schemes Here, the history, proliferation, functioning and refer of numbering schemes such as the Universal Product Code (UPC), the European Article Numbering (EAN) law and more special598ised codes like for example container codes (SSCC) are introduced. Most of these codes today are administered by the standardisation organisation GS1 (2005). Automated product identification technologies The technology with the greatest diffusion in the market is the barcode while specialize barcodes exist in some industries, the most common one is the UCC/EAN-128 (Coyle, Bardi Langley 1996). The second, much newer technology to be discussed here is Radio Frequency based Identification (RFID). Electronic Data Interchange (EDI) EDI is the basis for electronic ordering. Here, traditional EDI standa rds, such as the UN/EDIFACT, which was jointly developed by ISO and the UN (Coyle, Bardi Langley 1996), can be discussed, as well as newer techniques such as Internet-based meshingEDI and XML-enabled order exchange. In discussions with the students these enabling communication and data exchange technologies can then be related back to the beergame experience in that they 1) speed up the order process, thus reducing lead time and 2) enable more sophisticated information sharing of POS data. Moreover, they are the basis for the next step, the ICT-enabled redesign of supply chain structures. 4.3.2 ICT-enabled supply chain reform initiatives The second building block off in dealing with the bullwhip effect comprises a range of different supply chain reform initiatives that can be subsumed under the concept of efficient replenishment. As such, two distinct types of measures can be distinguished 1) inventory management concepts that aim at changing the ways in which actors in the suppl y chain lift out their roles of stock keeping and ordering and 2) logistics concepts that aim at improving actual material and information flow. Efficient inventory management is based on the idea that suppliers have timely access to POS data and can thus eliminate traditional forecasting and change the way ordering and inventory management is carried out (Lee, Padmanabhan Whang 1997b). Three concepts with increasing degrees of complexity can be distinguished Quick repartee The idea behind this concept is for the supplier to become more responsive to changes in customer demand through thesharing of POS data. Retailers still prepare individual orders, but suppliers are better prepared. Continuous refilling Suppliers continually receive POS data from retailers to prepare shipments at agreed-upon levels. vendor Managed Inventory (VMI) Under this initiative the suppliers manage all inventory aspects for their own products at the retailer end. Suppliers decide on shipment levels without any orders from the retail end to be placed. In fact, the retailer has very little to do with the operational aspects in VMI (Waller, Johnson Davis 1999). The second type of efficient replenishment measures is efficient logistics (see Simchi-Levi, Kaminsky Simchi-Levi 2003). Here, two main building blocks can be discussed store and delivery concepts Depending on the kinds of goods that are moved along the supply chain, different kinds of warehousing and delivery can be applied in order to achieve an optimal flow of goods. Cross docking is a concept in which warehouses function as inventory coordination points rather than actual inventory storage points hence, goods are only re-shuffled 599between trucks coming in from suppliers and trucks leaving for stores. This instrument can be used for steadfast selling products. For bulk products central warehousing can be used while fresh products benefit from direct delivery. Full-blown just-in-time delivery (JIT) Most commonly found in the automotive industry, just-in-time describes a concept, whereby supplier and manufacturer align their logistics and production processes to a degree that no (or very little) inventory is needed. Goods can be directly delivered from the production at the supplier to arrive just in time to be used in production at the manufacturer end (e.g. Johnson Wood 1996). Changing the way in which inventory is managed means to effectively change the supply chain structure. For example, by implementing VMI the supply chain partners eliminate one stage of ordering, thus eradicating one step in the typical bullwhip chain of events. Moreover, by speeding up product flows using the logistics concepts lead time is being reduced, which in turn softens the bullwhip effect. Consequently, all measures discussed in this section can be directly motivated by the beergame. In presenting this block to the students I also point out, for every singly concept, the role of information systems and eBus iness technologies. 4.3.3 eCollaboration jointplanning and global optimisation The third block of eBusiness measures for tackling the bullwhip effect is the most sophisticated one and builds on the first two blocks. Global optimisation of supply chain processes can only be achieved through the collaboration of supply chain partners under a joint initiative. I present the Collaborative Planning Forecasting and Replenishment (CPFR) initiative as an example from the Grocery industry (VICS 2001) and also discuss (sometimes only briefly) joint product development initiatives in the automotive industry. CPFR as a concept builds on and extends concepts such as VMI by aiming at establishing a long planning of joint promotion activities. CPFR is based on the observation that a combination of inventory management and logistics concepts (see section 4.3.2 above) can reduce the bullwhip effect for day-to-day deliveries, but that these concepts still can not cope with demand variations induced by promotion activities. Hence, CPFR aims at jointly planning promotions and to create transparency as to the expected demand increases induced by these promotions. The concept is based on the use of shared eMarketplace infrastructures, which I also discuss in some detail in this section. Again, the application of eCommerce technologies can be nicely illustrated using the beergame. 4.3.4 Summary The discussion of the three building blocks of eCommerce measures culminates in the development and presentation of an integrated model of eCommerce-based supply chain management informed by the key learnings from the beergame. The model is presented in figure 6. side by side(p) the line of argument in the last sections, it becomes obvious that the beergame can be used to motivate and patronize large parts of a typical eCommerce masters course (as in appendix 2). In the next section I draw some final conclusions and briefly reflect upon the use of the beergame in a classroom setting.600Sup ply Chain Reform Initiatives Supply Chain Reform Initiatives Tactics Operations cornerstoneImprovements ImprovementsSuppy Chain Suppy Chain problems problems trade-offs trade-offs knowledge lossJoint PlanningCPFR (promotions, product introduction), Category Mgmt, Production scheduleCollaborationStrategic alliances for global optimizationEfficient ReplenishmentInventory precaution Quick Response, CRP, VMI, SBT planICT-enabled supply Chain re-structuringS.C. structureMaterials information flow Direct delivery, Warehousing, X-dockingLocal optimizationCommunicationInformation sharing, Electronic orderingEfficient CommunicationsInfrastructure, EDI, AutoID, Product numbering, Process simplificationsFigure 6 A cosmopolitan eCommerce and supply chain model5 Conclusion and outlookI have introduced the beergame and demonstrated its value in teaching B2B eCommerce and supply chain management. To the present day, I have used the beergame mainly in eCommerce masters courses at different Universities in different national contexts. The experiences and also the teaching evaluations have eternally been domineering and very encouraging. While I believe that the beergame, and the way it is embedded in my B2B eCommerce syllabus,works well in providing students with both a profound understanding of the underlying wisdoms of eCommerce, as well as with a good overview of eCommerce measures, there is more to it than that. Playing the beergame is great fun, for the teacher and for the students, and it is always a good experience in itself. As such, the beergame is also very helpful for the general course atmosphere and the creation of positive team dynamics in the group. For the future, we are working on a software version of the beergame, which can be used in a classroom setting in the same interactive role-play style, but avoid some of the still remaining problems of the table version. While software versions today only provide a simulation (instead of role-play) mode and are not built for classroom use, a client-server software version of the game might replace the cumbersome logistics aspects (the moving of boxes) and help in gathering data that can be used for debriefing straight away. Moreover, it would be great to be able to play the beergame with different setups, e.g. with implementing effective sharing of (customer demand and inventory) data in order to demonstrate, in a second round of play, the usefulness of information sharing in reducing the bullwhip effect. To this end, our software will be flexible enough to incorporate such exploration of different supply chain modalities.11For further information please see http//www.beergame.org. 601Appendix 1 Beergame play sheet The following table shows the play sheet of a retailer group that was filled in during a beergame session. The incoming order column shows the external customer demand with its increase in round 6. During the game the students only have to fill in the dust coat columns th e incoming delivery and the incoming order are taken from the incoming paper slips, while in the your order column the students have to fill in their order decision for the respective weeks. Having done that, the play sheet shows exactly what has to be written on the outgoing order and delivery slips (in the dark columns). All orange columns are calculated automatically, so that students can easily keep track of their inventory and cost progression. After the beergame this data is then put together andconsolidated with the data that was collected in the play sheets of the other groups of the same supply chain. It is then plotted to create figures 3 and 4 and table 1 (see above). WeekIncoming DeliveryAvailableIncoming OrderYour DeliveryBackorderInventoryCost7,5 15 22,5 30 35 37 40 45 49 52 64 78 86 100 118 137 159 180 201 223 244 265 283 295 303 316 317,5 321 324,5 328 331,5 335 338,5 342 345,5 348,5 351 353 355 357Your OrderPlease fill out play slips Delivery Order0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 405 5 5 5 0 3 2 7 10 10 0 7 15 3 5 8 6 10 9 8 10 9 12 15 13 4 25 13 9 9 9 9 9 9 9 8 8 8 9 920 20 20 20 15 13 6 7 10 10 0 7 15 3 5 8 6 10 9 8 10 9 12 15 13 4 25 16 16 16 16 16 16 16 16 15 14 13 13 135 5 5 5 5 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 995 5 5 5 5 9 6 7 10 10 0 7 15 3 5 8 6 10 9 8 10 9 12 15 13 4 22 9 9 9 9 9 9 9 9 9 9 9 9 90 0 0 0 0 0 3 5 4 3 12 14 8 14 18 19 22 21 21 22 21 21 18 12 8 13 0 0 0 0 0 0 0 0 0 0 0 0 0 015 15 15 15 15 10 4 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 3 7 7 7 7 7 7 7 7 6 5 4 4 40 3 2 7 7 12 5 10 10 6 5 7 15 25 15 5 5 6 11 9 9 9 9 9 9 9 9 9 9 9 9 8 8 8 9 9 9 9 9 95 5 5 5 5 9 6 7 10 10 0 7 15 3 5 8 6 10 9 8 10 9 12 15 13 4 22 9 9 9 9 9 9 9 9 9 9 9 9 90 3 2 7 7 12 5 10 10 6 5 7 15 25 15 5 5 6 11 9 9 9 9 9 9 9 9 9 9 9 9 8 8 8 9 9 9 9 9 9602Appendix 2 Syllabus for a beergame-based B2B course The following table gives an overview of how t he beergame can be incorporated in a typical (B2B) eCommerce (masters) course (e.g. 12 weeks with 3 hour sessions). The beergame and the subsequent modules can cover up to 6 sessions. After presenting the three blocks with eCommerce improvements, an additional session can be used to discuss management challenges of inter-firm collaboration, covering issues such as trust, managing interfaces, ICT standards etc. Throughout the course, cases from the grocery and the automotive industries might be used for illustration purposes and to facilitate discussions. Depending on the setting, background readings might also be handed out to the students. Sessions (3 hours) Topics / session contents1. Beergame sessiona. Introduction to supply chains (why have supply chains?) b. Beergame introduction (setup, structure, rules of the game) c. Playing the game (40-50 rounds) d. Brief discussion afterwards2. Debriefinga. Discussion of experiences and game setup b. insertion and discussion of beergame data (results) c. Teaching case Barilla bullwhip causes optional d. Identification of the three main causes of the bullwhip effect e. small presentation of three areas of improvement and the schedule for the next three sessions3. Information sharinga. Short discussion why is information sharing important? b. Principles of electronic data sharing c. Attaching information to physical goods standardised product numbering, Automated product identification technologies barcodes, RFID d. Electronic Data Interchange EDI, WebEDI, XML-based ordering4. Supply chain reforma. Overview efficient replenishment initiatives b. Efficient inventory management Quick Response, Continuous Replenishment, Vendor Managed Inventory (VMI) c. Efficient Logistics Warehousing, Direct Delivery, CrossDocking d. Just-in-Time Delivery in the automotive industry Kanban5. eCollaborationa. eCollaboration in the supply chain idea and philosophy b. Collaborative Planning Forecasting Replenishment (CPFR) c. Joint produ ct development in the automotive industry6. Management of inter-firm collaborationa. Complexities of supply chain reform initiatives b. The role of trust and accessible capital in inter-firm relationships c. Interoperability of ICT d. Managing inter-firm interfaces603Appendix 3 Session outline for a beergame-based workshop The following table shows a short workshop format based on the beergame. Such a workshop can be incorporated in other (general IS) courses or be a stand-alone event, for example as an executive teaching offering. The workshop is essentially made up of two sessions the actual beergame session and a combined debriefing and learnings session. As an example industry the Grocery industry can be used to illustrate the application of the eCommerce initiatives and technologies. Sessions (3 hours) Topics / session contents1. Beergame sessiona. Introduction to supply chains (why have supply chains?) b. Beergame introduction (setup, structure, rules of the game) c. Playing the game (40 rounds) d. 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